My husband is half way through a 5 year IVA (after also paying into a DMP for 2 years which made the debt worse), the original debt was £13000 and he had to pay £9300 over the 5 years, we have not long had a progress letter to say he has paid in £4550. My parents have offered to pay off the IVA if thats possible but would that mean paying the full £13000, the £9300 or the remaining balance?! Thanks in advance
The normal figure quoted on the forum is to offer the amount left to pay, so if you half way through and have paid £4,500 then offer another £4,500. But you may get away with offering slightly less it all depends on the circumstances. If your parents are paying because their kind then it will be the full amount needed, if they are paying because you have lost your job or something then you may get away with slightly less.
When you make any offer make sure that you clearly detail that the money is a one off offer from your parents and that there is no higher amount available.
I would always recommend offering the full amount of remaining payments to generally secure a positive result. Why should creditors accept less at the end of the day.
I guess each case is based on its individual merits but to me the uncertainty of life would mean that creditors shouldn't always expect to receive the full amount of remaining payments as a F&F. 30 months is a long time after all, and surely it's more attractive for creditors to have a lump sum now rather than getting a slightly larger amount in dribs and drabs over 30 months ?.
I have my F&F creditors meeting on Wednesday and have no idea if it's going to be accepted. Strictly speaking I've 13 payments left and my monthly payments would come to £11600. My parents have offered £9k as a F&F.
I've already paid back more (£37200) than I would have done had my monthly payments never increased from that originally set (£36000), even though I've missed 4 payments in the last 12 months (which has led to my IVA being extended by 4 months). Original debt was £49,500.
Creditors are already foregoing interest on the money when an IVA is in place. I agree with Mel that the full amount of remaining payment should be offered.
Sharing from experiences of dealing with debt
There is a solution for everyone .... Just need to stay positive !
If creditors were that keen on securing the highest return possible why do they sell the debts on. In my case I have an IVA which would give a 90p in the £ return to the original creditors. Half way through they sold the debts on for some 10p in the £.. The new creditors have a return on investment in year 1 so any further funds are straight profit.
Say you make an offer to cover all remaining payments, but you make 2 further monthly payments before the agreement is approved (I have no idea how long the process takes) - is the agreed settlement adjusted accordingly?
That would depend on the terms of your revised offer Steve.1 - but potentially the further monthly payments made probably should be paid to your creditors in addition to the funds offered, unless your offer was based on a multiple of remaining contributions in which case I would say you could adjust the lump sum.
When I submitted my F&F offer my IP got me to confirm in my supporting letter that I would continue to make my normal monthly IVA payments up to and including the end of October, i.e. until the creditors meeting regarding my F&F offer had taken place. Presumably that is the norm unless there's a specific reason why you can't continue to make monthly payments, e.g. redundancy etc.
As for the timescale for the process, mine has taken approx. 10 weeks from submitting paperwork to my creditors meeting - to be honest I think my IP has dragged its heels somewhat (perhaps because I'd committed to still make monthly payments) but I know that creditors have to be given at least 28 days to respond to a F&F offer once made.
My creditors meeting in respect of my F&F offer is 11.30 today, I think it could go either way, opinion on here seems split between a negative view based on the fact that my offer is 22% less than the amount my remaining 13 monthly payments would provide, and a positive view based on the fact I've already paid 104% of the amount my creditors originally expected to receive when they first accepted my IVA proposals back in August 2009.
The monies available to me will be in the relevant account in a months time. Do you have to evidence it when you apply, or can you set the ball rolling in advance. We just want it done & dusted as soon as possible so would like to refer the offer to the IVA representative asap.
I think different IP's have different approaches, and it also depends how much the offer is for - as I understand it if the offer is over £10k then some kind of money laundering checks or such like have to be undertaken.
In my case I simply provided a letter from myself requesting that my IP approach my creditors on my behalf with a F&F offer, and a letter from my mother (who is offering the settlement) confirming the amount etc.
No news for me as yet, not exactly on tenderhooks though as have 1001 things to do at work !.
Well, Mel was right, my F&F offer was rejected, and my main creditor (who has taken over 3 of my debts) made it clear that they'd only accept a F&F which is the same as the total of my remaining monthly payments. The fact I'd already paid more than the amount originally expected during the lifetime of my IVA, the fact anything could happen over the next year seemingly counts for absolutely nothing.
Kind of frustrating that through my own efforts I recently got a substantial pay rise which is 50% of the difference between what I offered and my total amount. Maybe if I wasn't so successful in my job I'd have had a better outcome with my F&F offer.
Going straight back in with another F&F offer (for the full amount expected by monthly payments) - both my parents and myself fed up with controlling nature of IVA and simply want out of it.
I believe so, to be honest I was on the train when my IP called and I may have misunderstood.
C'est la vie, but what it only reaffirms in my view is that getting your creditors to accept an IVA proposal really is only the start of a very long and stressful journey...
It's a worrying thought that if the bulk of your debts are bought by 1 company then they have the power to have a major influence on it.
Had your 3 debts remained separately then the outcome may have been different..
